In accordance with the Employment Rights Act, there are only 5 permitted legal reasons to terminate a contract of employment, these are on the grounds of
- Capability, either performance or ill health
- Illegality/ breach of a statutory restriction
- Some other substantive reason.
As an employer, if you are dismissing an employee, it must be for one of the permitted reasons. Additionally, an employer must ensure a fair procedure is followed, and act reasonably in all the circumstances.
When an employment contract is terminated, an employee will usually be entitled to notice (unless summarily dismissed for gross misconduct), with notice either being contractual, or in the absence of a specified notice period, statutory notice will apply.
Generally speaking, an employment tribunal will not have jurisdiction to decide claims for unfair dismissal where the employee has less than two years continuous service. However, there are exceptions to this, and employers are encouraged to seek advice from our specialist employment team before proceeding to dismiss an employee. For example, there is no minimum service requirement where claims of discrimination or whistleblowing are advanced. Likewise, there is a whole host of potential claims which fall under the heading of auto unfair dismissal claims.
Before submitting a claim to the Employment Tribunal an employee will first have to instigate and go through the ACAS Early Conciliation process. ACAS will notify the employer that a claim has been asserted, and the parties will be given the option to conciliate and settle the claim at this stage. If as an employer you do not wish to conciliate you should advise ACAS, who will then issue a certificate to the employee. This will then enable the employee to proceed to issuing a claim at the employment tribunal. If the parties indicate a willingness to negotiate, the early conciliation process will usually last for 28 days, with ACAS having the discretion to extend this by a further 14 days if the parties are close to settlement.
Time limits for dismissal claims are quite tight and triggering the ACAS Early Conciliation process must be done within 3 months less one day of the ‘effective date of dismissal’. An employee does not have to terminate their employment and can assert a discrimination claim or a whistleblowing claim whilst they remain employed by you.
If you receive notification from ACAS Early Conciliation that an employment claim has been instigated, please do contact a member of our specialist employment team to seek advice. Defending a tribunal claim can take up a lot of valuable operational time and can be costly. If there is an opportunity to resolve a dispute at an early stage, this should be explored.
In an Employment Tribunal the employee (or ex-employee) is referred to as a Claimant, and the Employer is referred to as the Respondent. If a claim is issued at the Employment Tribunal as an employer, you will receive notification of the claim in the form of an ET1 form which is completed by the Claimant. As a named Respondent you will also receive an ET3 form which must be completed and returned to the Tribunal within 28 days. Missing this time limit can be fatal as you could be prevented from taking part in any proceedings going forward and a default judgement could be issued against you. There is limited scope to allow a Respondent to defend a claim if this time limit is missed. You should therefore seek advice from a member of our specialist employment team as soon as you become aware that a claim could be brought against you/your company.